EXHIBIT 99.1
PURCHASE AGREEMENT
This Purchase Agreement ("Agreement") is dated and effective as of
September 12, 1995, and is entered into by and among (i) American Ecology
Corporation, a Delaware corporation (the "Company"), (ii) Xxxx X. Xxxxxx, Xx.,
(iii) Xxxxxx X. Xxxx, (iv) Xxxx X. Xxxxxx, (v) Xxxx X. Xxxxxx and (vi) Xxxxx X.
Xxxxxxxx, Xx. (the individuals identified in clauses (ii) through (vi) being
herein referred to collectively as "Purchasers" and severally as "Purchaser").
In consideration of the agreements and undertakings of the parties
hereinafter set forth, and for other good and valuable consideration the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows.
1. Purchase and Sale of Securities. Subject to the terms and conditions set
-------------------------------
forth in this Agreement:
1.1 The Company will issue and sell to each Purchaser on the date hereof,
and each Purchaser will purchase from the Company on the date hereof, a
Nonnegotiable Promissory Note in the form attached hereto as Exhibit A ("Demand
---------
Note"). The principal amount of the Demand Note to be purchased by each
Purchaser is set forth on Schedule 1, attached hereto. The purchase price of
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each Demand Note shall be paid in cash to the Company on the date of this
Agreement by the Purchaser of that Demand Note. The obligations of the
respective Purchasers to purchase the Demand Notes pursuant to this Agreement
are several, and not joint. The purchase and sale of the Demand Notes is
referred to in this Agreement as the "First Funding." The First Funding shall
occur at the offices of Mayor, Day, Xxxxxxxx & Xxxxxx, L.L.P., 19th Floor, 000
Xxxxxxxxx, Xxxxxxx, Xxxxx 00000 not later than the close of business on the date
of this Agreement, or at such other time and place as may be agreed to by all of
the parties to this Agreement.
1.2 The Company will issue and sell to each Purchaser on or before the
"Second Funding Date" (as specified on Schedule 1), and each Purchaser will
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purchase from the Company on or before such Second Funding Date, (a) the number
of shares of Series D Preferred Stock (as hereinafter defined) specified on
Schedule 1 and (b) the number of $4.75 Warrants (as hereinafter defined)
----------
specified on Schedule 1 of the Company. The aggregate purchase price of each
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(i) one share of Series D Preferred Stock and (ii) each ten $4.75 Warrants shall
be $47.50, which shall be paid to the Company on the Second Funding Date by
surrender of an equal principal amount of Demand Notes (and all accrued and
unpaid interest on the surrendered amount shall be paid in full in cash by the
Company). The obligations of the respective Purchasers to purchase shares of
Series D Preferred Stock and $4.75 Warrants on or before the Second Funding Date
pursuant to this Agreement are several, and not joint. The purchase and sale of
the shares of Series D Preferred Stock and $4.75 Warrants on or before the
Second Funding Date shall occur at the offices of Mayor, Day, Xxxxxxxx & Xxxxxx,
L.L.P., 19th Floor, 000 Xxxxxxxxx, Xxxxxxx, Xxxxx 00000 not later than the close
of business on the Second Funding Date, or at such other time and place as may
be agreed to by all of the parties to this Agreement. As used in this Purchase
Agreement, the term "Series D Preferred Stock" means a series of preferred stock
of the Company established by the Certificate of Designation,
Preferences and Rights of Series D Cumulative Convertible Preferred Stock of
American Ecology Corporation (the "Certificate of Designation") attached hereto
as Exhibit B. As used in this Agreement, the term "$4.75 Warrant" means a
---------
Warrant to purchase common stock of the Company in the form attached hereto as
Exhibit C.
---------
1.3 The Company will issue and sell to each Purchaser on or before the
"Third Funding Date" (as specified on Schedule 1), and each Purchaser will
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purchase (or cause to be purchased by one or more qualified substitute
purchasers pursuant to Section 8 of this Agreement) from the Company on or
before such Third Funding Date, (a) the number of shares of Series D Preferred
Stock specified on Schedule 1 and (b) the number of $4.75 Warrants specified on
----------
Schedule 1 of the Company. The aggregate purchase price of (i) each one share
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of Series D Preferred Stock and (ii) each ten $4.75 Warrants shall be $47.50,
which shall be paid to the Company on the Third Funding Date in cash. The
obligations of the respective Purchasers to purchase (or cause to be purchased
by one or more other qualified substitute purchasers pursuant to Section 8 of
this Agreement) shares of Series D Preferred Stock and $4.75 Warrants on or
before the Third Funding Date pursuant to this Agreement are several, and not
joint. The purchase and sale of the shares of Series D Preferred Stock and
$4.75 Warrants on or before the Third Funding Date shall occur at the offices of
Mayor, Day, Xxxxxxxx & Xxxxxx, L.L.P., 19th Floor, 000 Xxxxxxxxx, Xxxxxxx, Xxxxx
00000 not later than the close of business on the Third Funding Date, or at such
other time and place as may be agreed to by all of the parties to this
Agreement.
1.4 The Company will issue and sell to Xxxxx X. Xxxxxxxx, Xx. ("Xxxxxxxx")
on or before January 5, 1996 (the "Fourth Funding Date"), and Xxxxxxxx will
purchase (or cause to be purchased by one or more qualified substitute
purchasers pursuant to Section 8 of this Agreement) from the Company on or
before such Fourth Funding Date, (a) the number of shares of Series D Preferred
Stock specified on Schedule 1 and (b) the number of $4.75 Warrants specified on
----------
Schedule 1 of the Company. The aggregate purchase price of (i) each one share
----------
of Series D Preferred Stock (ii) each ten $4.75 Warrants shall be $47.50, which
shall be paid to the Company on the Fourth Funding Date in cash. The purchase
and sale of the shares of Series D Preferred Stock and $4.75 Warrants on or
before the Fourth Funding Date shall occur at the offices of Mayor, Day,
Xxxxxxxx & Xxxxxx, L.L.P., 19th Floor, 000 Xxxxxxxxx, Xxxxxxx, Xxxxx 00000 not
later than the close of business on the Fourth Funding Date, or at such other
time and place as may be agreed to by Xxxxxxxx and the Company.
2. Representations of the Company. The Company represents and warrants to each
------------------------------
Purchaser as follows:
2.1 The Company has all requisite corporate power and authority to enter
into this Agreement and, assuming satisfaction of the conditions to the
obligations of the Company set forth in Section 6 of this Agreement, to perform
all the obligations required to be performed by the Company under this
Agreement. This Agreement has been duly executed and delivered by the Company,
and, upon execution and delivery by the Purchasers, this Agreement will be the
valid and legally binding obligation of the Company, enforceable as to the
Company in
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accordance with its terms except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
relating to or affecting enforcement of creditors' rights and equitable
remedies. Upon issuance of the Securities at the Second Funding, the Third
Funding and the Fourth Funding: all requisite corporate action shall have been
taken for the issuance thereof; all shares of Series D Preferred Stock then
being issued shall be, all $4.75 Warrants then being issued shall be, and all
shares of Common Stock issuable pursuant to such Securities then being issued
("Underlying Common Shares") shall be upon issuance of such Underlying Common
Shares, duly authorized, validly issued, fully paid and nonassessable and issued
without violation of and not subject to any preemptive right; and a number of
shares of authorized and unissued Common Stock of the Company equal to the
number of such Underlying Common Shares shall have been reserved for issuance
pursuant to such Securities then being issued.
2.2 The Company will cooperate fully to provide the Special Committee
referred to in Section 6 of this Agreement with all such information and
support, including cooperation with XxXxxxx & Company and legal counsel to the
Special Committee, as the Special Committee may reasonably require in connection
with the satisfaction of the conditions to the obligations of the Company set
forth in Section 6. The Company will use its commercially reasonable best
efforts to satisfy as promptly as is reasonably practicable any applicable
requirements of Section 5(i)(1)(e) of Part III of Schedule D to the Bylaws of
the National Association of Securities Dealers, Inc. (the "NASD Exception").
3. Representations of Purchasers. Each Purchaser, severally and not jointly,
-----------------------------
represents and warrants to the Company as to himself as follows:
3.1 Such Purchaser has all requisite authority to enter into this
Agreement and to perform all the obligations required to be performed by such
Purchaser under this Agreement. This Agreement has been duly executed and
delivered by such Purchaser, and, upon execution and delivery by the Company and
the other Purchasers, this Agreement will be the valid and legally binding
obligation of such Purchaser, enforceable as to such Purchaser in accordance
with its terms except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application relating to or
affecting enforcement of creditors' rights and equitable remedies.
3.2 Neither the Company nor any person acting or purporting to act on
behalf of the Company has offered or sold any of the Securities to such
Purchaser by means of any form of general solicitation or general advertising.
Such Purchaser is acquiring the Securities to be purchased by such Purchaser
under this Agreement solely for his own beneficial account, for investment
purposes, and not with any view to, or for resale in connection with, any
distribution of any such Securities. Such Purchaser understands that the
Securities have not been registered under the Securities Act of 1933, as amended
(the "Act"), or any state securities laws, by reason of specific exemptions
under the provisions thereof which depend in part upon the investment intent of
such Purchaser and upon the accuracy of the other representations made by such
Purchaser in this Agreement. Such Purchaser understands that the Company is
relying upon the
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representations and agreements contained in this Agreement for the purpose of
determining that the transactions contemplated by this Agreement meet the
requirements for such exemptions.
4. Restrictive Legends.
-------------------
4.1 Each certificate or other document representing any of the Demand
Notes, shares of Series D Preferred Stock, $4.75 Warrants or shares of common
stock issuable in respect of the foregoing (collectively the "Securities" and
individually a "Security") issued pursuant to this Agreement shall be stamped or
otherwise imprinted with a restrictive legend in the form set forth on the form
of such Security as attached hereto as an exhibit (or, in the case of shares of
Series D Preferred stock or shares of common stock issuable upon conversion
thereof, an equivalent legend appropriately modified to refer to such
Securities). In the event of any transfer or reissuance of any such Security,
the certificates or other instruments representing such Securities shall
continue to bear such legends.
4.2 The Company hereby agrees that it will promptly deliver or cause to be
delivered a new certificate or certificates or instrument or instruments for any
Securities, which certificate or certificates or instrument or instruments will
not bear the legends referred to above, upon determination by the Company that
such Securities have been held beneficially by the holder for at least three
years and that such holder is not and has not been within the preceding three
months an affiliate of the Company. All determinations pursuant to the
preceding sentence shall be made in accordance with Rule 144(k) under the Act or
any applicable successor rule. In the event that a period shorter than
specified above is permitted by reason of the amendment or replacement of such
Rule 144(k), then the Company shall impose no greater restriction than the
restriction imposed as the result of such amendment or replacement.
5. Conditions to the Obligations of the Purchasers.
-----------------------------------------------
5.1 The obligations of each Purchaser to purchase the Securities to be
purchased by such Purchaser under this Agreement at the time of each of the
First Funding, the Second Funding, the Third Funding or the Fourth Funding, as
the case may be, are subject to the satisfaction or waiver by such Purchaser of
the following conditions:
(a) The Company shall, against receipt of payment therefor as provided
herein, deliver to the Purchaser the certificates or other instruments
evidencing such Securities in the form contemplated by this Agreement; and
(b) The representations of the Company set forth in section 2 of the
Agreement shall be true and correct in all material respects at the time of
such purchase and sale of such Securities.
5.2 The obligations of each Purchaser to purchase the Securities to be
purchased by such Purchaser under this Agreement at the time of each of the
Second Funding, the Third Funding and the Fourth Funding, as the case may be,
are subject to the satisfaction or waiver
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by such Purchaser of the condition that, at or prior to the Second Funding, (i)
the Special Committee shall have determined by appropriate resolution that the
conditions to the obligations of the Company set forth in Section 6.2 have been
satisfied or waived by the Special Committee and (ii) the Certificate of
Designation shall have been adopted and filed with the Secretary of State of
Delaware.
6. Conditions to the Obligations of the Company.
--------------------------------------------
6.1 The obligations of the Company to issue and sell the Securities to be
issued and sold by the Company under this Agreement at the time of each of the
First Funding, the Second Funding, the Third Funding or the Fourth Funding, as
the case may be, are subject to the satisfaction or waiver by the Company of the
following conditions:
(a) Each Purchaser (or in the case of the Third Funding and the Fourth
Funding another qualified purchaser pursuant to Section 8 of this
Agreement) shall have delivered payment as provided herein against delivery
to such Purchaser of the certificates or other instruments evidencing such
Securities in the form contemplated by this Agreement; and
(b) The representations of each Purchaser set forth in Section 3 of
this Agreement shall be true and correct in all material respects at the
time of such purchase and sale of such Securities; and
(c) The Company shall have received such consents, waivers and
agreements from its secured bank lender as shall be required, in the
judgment of the Special Committee, to permit the issuance and sale of such
Securities with the result that, upon consummation of such issuance and
sale, the Company shall not be in default (or shall be subject to a
forbearance agreement reasonably satisfactory to the Special Committee with
respect to any such default) under the provisions of any agreement or
instrument governing or evidencing any obligations of the Company to its
secured bank lender.
6.2 The obligations of the Company to issue and sell the Securities to be
issued and sold by the Company under this Agreement at the time of each of the
Second Funding, the Third Funding and the Fourth Funding, as the case may be,
are subject to the satisfaction or waiver of the condition that the Special
Committee of the Board of Directors established on September 7, 1995 (the
"Special Committee") shall have determined by appropriate resolution, at or
prior to the Second Funding, that:
(a) The Company shall have received a fairness opinion satisfactory to
it pursuant to the engagement letter agreement between the Company and
XxXxxxx & Company;
(b) The Special Committee shall have approved and adopted the
resolution set forth in the Certificate of Designation; and
5
(c) The issuance of the Securities by the Company at the Second Funding
shall not violate any applicable requirements of the NASD Exception.
7. Registration Rights.
-------------------
7.1 As used in this Section 7:
(a) The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Act, and the declaration or ordering of the
effectiveness of such registration statement.
(b) The term "Registrable Securities" means: (i) any common stock of
the Company ("Common Stock") issued, or issuable, upon the conversion of
any Series D Preferred Stock, regardless of whether such conversion has
taken place at any time, and (ii) any Common Stock issued, or issuable upon
the conversion or exercise of any $4.75 Warrant, regardless of whether such
exercise has taken place at any time, or any warrant, right or other
security which is issued as a dividend or other distribution with respect
to, or in exchange for or in replacement of, any Series D Preferred Stock
or any $4.75 Warrant or, excluding in all cases, however, any Registrable
Securities sold by a person in a transaction in which his rights under this
Section 7 are not assigned.
(c) The term "Holder" means any holder of Registrable Securities who
acquired such Registrable Securities in a transaction or series of
transactions not involving any public offering or any sale pursuant to Rule
144 under the Act.
7.2 The Company hereby agrees that:
(a) If at any time or from time to time, the Company determines to
register any of its securities, either for its own account or the account
of a security holder or holders, (other than a registration solely to
implement an employee benefit plan or a registration on Form S-4), the
Company will:
(i) promptly give to each Holder written notice thereof (which
will include a list of the jurisdictions in which the Company intends
to attempt to qualify such securities under the applicable blue sky
law or other state securities laws); and
(ii) include in such registration (and any related qualification
under blue sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities specified in any
written request or requests by any Holder received by the Company
within twenty (20) days after such written notice is given and make
its best efforts to qualify all the Registrable Securities specified
in such request under the blue sky or other securities laws of any
jurisdiction which said Holders may reasonably request.
6
(b) If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company will so
advise the Holders as a part of the written notice given pursuant to
Section 7.2(a)(i) above. In such event, the right of any Holder to
registration pursuant to this Section 7.2 will be conditioned upon such
Holder's participation in such underwriting and the inclusion of such
Holder's Registrable Securities in the underwriting to the extent provided
herein. All Holders proposing to distribute Registrable Securities through
such underwriting (together with the Company and the other shareholders
distributing their securities through such underwriting) will enter into an
underwriting agreement in customary form, satisfactory to the Company, with
the underwriter or underwriters selected for such underwriting by the
Company. Notwithstanding any other provision of this Section 7.2, if the
managing underwriter determines in good faith that marketing factors
require a limitation of the number of shares to be underwritten for the
accounts of holders of Registrable Securities and other securities of the
Company entitled to registration pursuant to agreements with the Company,
the managing underwriter may limit the number of Registrable Securities and
other securities of the Company entitled to registration pursuant to
agreements with the Company to be included in the registration. The
Company will so advise all Holders of Registrable Securities and all
shareholders owning securities of the Company entitled to registration
pursuant to agreements with the Company and participating in such
registration, and the number of shares of Registrable Securities and such
other securities that may be included in the registration and underwriting
will be allocated (subject to the provision in the previous sentence) among
all Holders and other shareholders in proportion, as nearly as practicable,
to the respective amounts of Registrable Securities and such other
securities entitled to such registration held by such Holders and other
shareholders at the time of filing the registration statement. No
Registrable Securities excluded from the underwriting by reason of the
underwriter's marketing limitation will be included in such registration.
If any Holder disapproves of the terms of the underwriting, he may elect to
withdraw therefrom by written notice to the Company and the managing
underwriter. The Registrable Securities so withdrawn will also be
withdrawn from registration; provided, however, that, if by the withdrawal
of such Registrable Securities or any other securities entitled to
registration pursuant to agreements with the Company a greater number of
Registrable Securities held by other Holders may be included in such
registration (up to the maximum of any limitation imposed by the managing
underwriter) then the Company will offer to all Holders and other
shareholders who have included Registrable Securities and such other
securities in the registration the right to include additional Registrable
Securities or other securities in proportion to the amounts of their
Registrable Securities and such other securities so included.
(c) The Company shall cooperate and communicate with all Holders
wishing to participate in any registration pursuant to this Section 7.2 so
as to permit them a reasonable and effective opportunity to participate,
including providing prompt notice of any stop orders and copies of all
registration statements and prospectuses filed with the Securities and
Exchange Commission, including any amendments, and any such other
7
materials and information that is provided to other participating
securities holders. The Company will bear all expenses of any
registration, including filing fees, blue sky fees and expenses, accounting
and legal fees and expenses, printing and mailing costs and other similar
expenses, but will not bear any expenses (including fees of legal counsel)
incurred by participating Holders and will not bear any underwriting
discount or concession or similar sale costs with respect to Registrable
Securities offered and sold by or for participating Holders. The Company
and the participating Holders will agree to indemnify each other or to
contribute to one another on reasonable and customary terms.
8. Other Qualified Purchasers. The Company agrees that the Purchasers may
--------------------------
cause the Securities to be purchased at the Third Funding and/or the Fourth
Funding in whole or in part by one or more qualified substitute purchasers. For
purposes of this Agreement, a qualified substitute purchaser is any person who
(i) is an accredited investor as defined in Regulation D under the Act and (ii)
who executes a subscription agreement containing representations regarding,
among other things, such person's financial sophistication, knowledge of and
access to information regarding the Company, which is reasonably satisfactory to
the Special Committee and its counsel. The Company will cooperate fully to
provide access to information to any such person, subject to customary
confidentiality requirements. Each Purchaser agrees that he will not take any
actions with respect to any proposed substitute purchasers that would require
any registration of any Securities by the Company under the Act or any other
securities laws.
9. Miscellaneous
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9.1 Remedies Not Exclusive. No remedy conferred by any of the specific
provisions of this Agreement is intended to be exclusive of any other remedy,
and each and every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity or
by statute or otherwise. The election of any one or more remedies by any party
hereto shall not constitute a waiver of the right to pursue other available
remedies.
9.2 Parties Bound. Except to the extent otherwise expressly provided
herein, this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, representatives, administrators,
guardians, successors and assigns; and no other person shall have any right,
benefit or obligation hereunder.
9.3 Notices. All notices, reports, records or other communications that
are required or permitted to be given to the parties under this Agreement shall
be sufficient in all respects if given in writing and delivered in person, by
telecopy, by overnight courier or by registered or certified mail, postage
prepaid, return receipt requested, to the receiving party at the following
address:
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If to a Purchaser, to him at the most recent address furnished by him to
the Company;
With a copy to:
Xxxxxx & Xxxxx, a Professional Corporation
000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxx
If to the Company, to each member of the Special Committee at the most
recent address furnished by him or her to the Company;
With a copy to:
Mayor, Day, Xxxxxxxx & Xxxxxx, L.L.P.
000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxxx X. Xxxxxx
or to such other address as such party may have given to the other parties by
notice pursuant to this Section 9.3. Notice shall be deemed given on the date
of delivery, in the case of personal delivery or telecopy, or on the delivery or
refusal date, as specified on the return receipt, in the case of overnight
courier or registered or certified mail.
9.4 CHOICE OF LAW. THIS AGREEMENT SHALL BE CONSTRUED, INTERPRETED, AND
THE RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF TEXAS, WITHOUT GIVING EFFECT TO ANY CONFLICTS OF LAWS PRINCIPLES.
9.5 Entire Agreement; Amendments and Waivers; Assignment. This Agreement,
together with all exhibits and schedules hereto, constitutes the entire
agreement between the parties pertaining to the subject matter hereof and
supersedes all prior and contemporaneous agreements, understandings,
negotiations and discussions, whether oral or written, of the parties. Without
limitation to the foregoing, it is agreed that that certain Agreement dated
August 21, 1995 among the Company and the Purchasers, as modified by that
certain Addendum dated as of that same date and regardless of the version or
versions executed by any one or more of the Purchasers (the "Original
Agreement"), is expressly terminated and superseded and neither the Company nor
any of the Purchasers shall hereafter have any rights or obligations under or in
respect of the Original Agreement. Except as set forth herein, there are no
warranties, representations or other agreements between the parties in
connection with the subject matter hereof. No supplement, modification or
waiver of this Agreement shall be binding unless it shall be specifically
designated to be a supplement, modification or waiver of this Agreement and
shall be executed in writing by each party to be bound thereby. No waiver of
any of the provisions of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. No waiver of any of the provisions of
this Agreement shall be deemed or shall
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constitute a waiver of any other provision hereof (whether or not similar), nor
shall such waiver constitute a continuing waiver unless otherwise expressly
provided. In the event of any permitted transfer of any Securities, the rights
of the Holder thereof pursuant to Section 7 shall be transferred automatically.
Except as set forth in the preceding sentence and except as provided in Section
8 hereof, this Agreement may not be assigned by operation of law or otherwise.
9.6 Further Assurances. From time to time hereafter and without further
consideration, each of the parties hereto shall execute and deliver such
additional or further instruments of conveyance, assignment and transfer and
take such actions as any of the other parties hereto may reasonably request in
order to more effectively consummate the transactions contemplated by this
Agreement or as shall be reasonably necessary or appropriate in connection with
the carrying out of the parties' respective obligations hereunder or the
purposes of this Agreement.
9.7 Multiple Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.8 Headings. The headings of the several Sections herein are inserted
for convenience of reference only and are not intended to be a part of or to
affect the meaning or interpretation of this Agreement.
9.9 Legal Fees. The Company will pay the reasonable fees and expenses of
Xxxxxx & Xxxxx, a Professional Corporation, incurred in acting as counsel to the
Purchasers.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of September 12, 1995.
AMERICAN ECOLOGY CORPORATION
By:________________________________________
Name:______________________________________
Title:_____________________________________
___________________________________________
Xxxxxx X. Xxxx
___________________________________________
Xxxx Xxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxxx X. Xxxxxxxx, Xx.
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SCHEDULE 1
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First Funding:
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Demand Note
Purchaser Amount
---------------------------------- -------------
Xxxx Xxxxxx $ 125,001.00
Xxxxxx X. Xxxx 1,500,012.00
Xxxx X. Xxxxxx 250,002.00
Xxxx X. Xxxxxx 250,002.00
Xxxxx X. Xxxxxxxx, Xx. 1,125,009.00
Second Funding (on or before September 26, 1995):
------------------------------------------------
Aggregate Purchase
Price of Series D
Preferred Stock
Shares and $4.75
Number of Shares Warrants to be
of Series D Number of be Purchased at
Purchaser Preferred Stock $4.75 Warrants Second Funding
------------------------ ---------------- -------------- -----------------
Xxxx Xxxxxx 2,631.6 26,316 $ 125,001.00
Xxxxxx X. Xxxx 31,579.2 315,792 1,500,012.00
Xxxx X. Xxxxxx 5,263.2 52,632 250,002.00
Xxxx X. Xxxxxx 5,263.2 52,632 250,002.00
Xxxxx X. Xxxxxxxx, Xx. 23,684.4 236,844 1,125,009.00
Third Funding (on or before September 30, 1995):
-----------------------------------------------
Aggregate Purchase
Price of Series D
Preferred Stock
Shares and $4.75
Number of Shares Warrants to be
of Series D Number of be Purchased at
Purchaser Preferred Stock $4.75 Warrants Third Funding
------------------------ ---------------- -------------- -----------------
Xxxx Xxxxxx 3,157.92 31,579.2 $150,001.20
Xxxxxx X. Xxxx 3,157.92 31,579.2 150,001.20
Xxxx X. Xxxxxx 3,157.92 31,579.2 150,001.20
Xxxx X. Xxxxxx* 3,157.92 31,579.2 150,001.20
Xxxxx X. Xxxxxxxx, Xx. 3,157.92 31,579.2 150,001.20
________________
* Xx. Xxxxxx is not obligated to purchase these Securities; however, to the
extent that Xx. Xxxxxx does not purchase these Securities, the remaining
Purchasers will each be severally obligated to purchase 25% of the unsubscribed
amount.
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Fourth Funding (on or before January 5, 1996):
---------------------------------------------
Aggregate Purchase
Price of Series D
Preferred Stock
Shares and $4.75
Number of Shares Warrants to be
of Series D Number of be Purchased at
Purchaser Preferred Stock $4.75 Warrants Fourth Funding
------------------------ ---------------- -------------- -----------------
Xxxxx X. Xxxxxxxx, Xx. 21,052.8 210,528 $1,000,008.00
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